As described in Michael Lewis' book Moneyball, A's General Manager Billy Beane pioneered the use of statistical analysis to guide personnel decisions in major league baseball....
I am a big fan of Beane and his methods, all the more so because George Mason University has used a similar approach in hiring faculty for our law school and economics department, both of which have risen in the rankings almost as fast as Beane's A's rose in the American league standings. Both the A's and GMU use statistical analysis to identify "players" whose productivity has been undervalued by their respective industries, and sign them before the competition catches on. Both also have far less money to spend on payroll than their wealthier competitors, and so have to do more with less.

There are other examples of this strategy paying off--in political science, for example, the University of Rochester vaulted to the top back in the '70s and '80s because they specialized in hiring public choice theorists long before Stanford or Harvard started snapping them up. I have heard more than one political scientist embrace Moneyball as their department's strategy for climbing to the top.

So, it appears that lower-tier departments adopt the Moneyball approach of hiring good but unfashionable scholars as a way of developing a comparative advantage. However, I can think of two reasons why this strategy has long-term drawbacks:

1) In the end, you get poached. All approaches and areas of inquiry become fashionable at some point--even military historians. Once a department has attained a flush of prominence, the old standbys will come with their deep pockets to make lucrative free agent signings. The cream of a department's crop gets poached, leading to a slow decline.

The gain of a short-term boost might be worth the price of long-term backsliding, were it not for the second hazard of a Moneyball approach:

2) The risks of overspecialization. When a department hires a lot in a specialty or methodology that is currently unappreciated, they are essentially letting these scholars run the show. A history department dominated by military historians, a political science department dominated by postmodernists, or a law faculty dominated by critical legal theorists risks appearing unfriendly to good scholars from other traditions.

If departments overspecialize, they risk falling into a trap: they can only successfully recruit people from a particular scholarly tradition, but the best of those people will eventually be lured away to premier institutions. Because the social sciences tend to see cutting-edge scholarship emerge from different approaches over time, a department that specializes in one approach risks acquiring blinders about where the rest of the field is going. The end result: a mediocre department stuffed with tenured academics who can't get a job anywhere else and don't know how to identify the up-and-comers in a discipline.

These pitfalls are not necessarily inevitable, but they are a possibility that is often overlooked by Moneyball enthusiasts.

I'd be curious to hear from Open U.'s other contributors and readers--can anyone think of a deartment that vaulted itself to the top using a Moneyball approach, but then managed to stay in the top tier for a sustained period of time?